Category: Net Neutrality

Capitalism at its best offers a fantastic way for innovative ideas to get their moment in the sun.

The availability of capital to be risked has taken the world from kings and serfdom to a relatively amazing place. The modern industrial universe is on the internet.

So allowing the “owners” of the internet infrastructure to decide who gets to play and can charge different rates for different access is in effect removing the ability of disruptive technology to get a foot hold.

Why would a cable company want Netflix to thrive, it’s killing their old business model?

Why would a bank or insurance company want a financial service aggregator to thrive, they are forcing down prices.

Why would Google want a distributive search service to thrive, it’s could decimate their ad revenue?

Why would anyone who is in a position of power today want to allow new ideas that directly impact their current revenue stream to happen?

Well quite simply they would not.

Today a small number of very large business are intertwined and deliver the backbone and on and off-ramps to the internet. The law has until now required them to openly offer their services without consideration of the type of use their customers are putting the systems too. And this has allowed millions of new ideas to grow and be tried. Many have failed but some have become the best ideas of their time. Each one if them was disruptive, but with the end of net neutrality in the future many new ideas will not be able to compete, as the incumbents will have the ability to make disruption untenable though now legal aggressive pricing tactics.

Anyone who thinks this will not happen when net neutrality is removed just needs to look at every single other time when anti-competive ideas have been legal. Asking the wolf to guard the hen house never works. Business will always use every advantage it has, if it’s allowed it will be done. If its almost allowed it will be done. The only time a business acts ethically is when there is a material advantage in doing so. Many businesses talk about doing good, but that is simply because doing good things can be good for the balance sheet. Business is a matter of survival of the fittest, and when you allow the biggest to have a huge advantage they will always take it.

This is why rules that allow new ideas from new people to gain a foothold are so incredibly important. In the same way that the oil and car industries held back alternative fuels, electric cars and high speed rail, giving Comcast, Cisco, Google, AT&T and the rest of the current crop if internet giants a way to make new internet based ideas unprofitable can only be bad for capitalism. The rise and fall of the roman empire tells a deeply relevant story.

Let’s not allow the rise and fall of the internet to read the same way.